CREDIT CARDS: A MYTHBUSTER
There could be many reasons why you choose a credit card, but before you decide, it’s likely you’ll take time to look into some of the common notions about them first. For example, what is the best credit card to have? Is it true that you are entitled to rewards as a card holder? Can you draw cash from ATMs? Will your credit card purchases be kept separate from your bank account?
It is always sensible to carefully consider any financial decision you make, especially if you’re starting a new life in the UAE. But hopefully some of these points below will help debunk certain myths and clarify some aspects of credit card use, to help you see how to get more from your credit card:
Protection for your purchases
Using a credit card for big purchases is sage advice you might have already heard from your parents. This is because you are more protected with your credit card than with a debit card, should you need to claim your money back from a vendor for a purchase.
Moreover, if your card were used fraudulently, you are safer from financial loss and more likely to get your money back with a credit card.
Spread the cost of purchases
Obviously, it will need to be an amount within your credit card limit, but if you need to buy something and can’t afford it all straightaway then a credit card allows you to buy the item now and then pay back your credit card in stages.
The truth about the grace period
What credit cards are best for a first credit card? While it is true that there is a grace period for credit cards if you haven’t paid within your billing period, this usually only applies when you don’t have outstanding bills from previous months. However, if you have a clean slate, then this is a good feature to use as should you miss a payment, you may be entitled to the grace period.
Drawing cash from ATMs
Some people aren’t sure about whether or not it is possible to withdraw cash from a machine with a credit card. But it is usually possible to do this, you just need to be aware of higher charges for doing this. So it is not something you want to make a habit of if you can help it, as these interest rates can rack up.
Keeping your bank account separate
Having a credit card is a good way of keeping your bank account separate, and untouched – which is a handy thing to have if you’re just moving to the UAE and want to try and keep track of your finances. You’ll be able to see your in-comings and out-goings clearly, with your credit card purchases accounted for separately.
Terms and conditions are all the same
Think it’s not worth reading your card issuer’s terms? You couldn’t be more wrong. Each card issuer and residing country will have different terms and also benefits, so it is always worth checking these out so you are well aware of all the information regarding your credit card.